Fitch Downgrades One Distressed Class of MSC 1999-CAM1

May 29, 2014 04:09 PM Eastern Daylight Time

NEW YORK--(BUSINESS WIRE)--Fitch Ratings has downgraded one and affirmed three classes of Morgan
Stanley Capital I Trust 1999-CAM1 (MSC 1999-CAM1). A detailed list of
rating actions follows at the end of this release.

KEY RATING DRIVERS

The downgrade of class M reflects a greater certainty of losses,
primarily from the one specially serviced loan (10% of pool). The
affirmations of the other remaining classes reflect stable overall pool
performance and continued amortization since Fitch's last rating action.
As of the May 2014 distribution date, the pool balance has been reduced
by 97.9% to $16.7 million from $806.5 million at issuance. Eighteen of
the original 152 loans remain. There are no defeased loans and 32.3% of
the pool is fully amortizing. There are 12 loans (53.4%) which are
credit-tenant lease loans on single-tenanted properties. The pool's
largest listed credit tenants include: CVS Caremark Corporation (18.2%
of pool), Best Buy (16.9%), and Walgreen Co. (5.8%). Interest shortfalls
are currently affecting classes M through O.

The specially serviced loan (10% of pool) is secured by a 48,678 square
foot (sf) office property located in Columbia, SC. The loan was
transferred to special servicing after Fitch's last rating action in
August 2013 for maturity default; the loan matured in June 2013.
According to the latest January 2013 rent roll provided by the special
servicer, the property was 56% occupied by six tenants, compared to 93%
at issuance. Near-term lease expiration includes 8.4% of the property
square footage in 2014 and 32% in 2015. The servicer indicated the
borrower is in the process of addressing and remediating mold issues at
the property. The servicer expects a deed-in-lieu of foreclosure and a
real-estate owned sale.

The largest loan (20.2%) is secured by a 79,038 sf medical office
property located in Fairfax, VA. Occupancy has continually declined
since issuance. According to the December 2013 rent roll, occupancy was
76%, compared to 87% in 2012 and 95% at issuance. The property is
occupied mostly by doctors and medically-related tenants as it is
located by the Inova Fair Oaks Hospital. Although occupancy has
declined, the loan's debt service coverage ratio was 2.37x for 2013.

RATINGS SENSITIVITIES

The Rating Outlook on classes K and L remains Stable as upgrades are not
anticipated due to the significant concentration of the remaining pool
and the risks associated with single-tenanted properties.

Fitch has downgraded the following class:

-- $6 million class M to 'Csf' from 'CCsf'; RE 90%.

In addition, Fitch has affirmed the following classes:

-- $3.8 million class K at 'BBBsf'; Outlook Stable;

-- $6 million class L at 'BB-sf'; Outlook Stable;

-- $0.8 million class N at 'Dsf'; RE 0%.

Classes A-1 through J have paid in full. Fitch does not rate class O.
Fitch previously withdrew its rating on the interest-only class X.

Additional information on Fitch's criteria for analyzing U.S. CMBS
transactions is available in the Dec. 11, 2013 report, 'U.S. Fixed-Rate
Multiborrower CMBS Surveillance and Re-REMIC Criteria', which is
available at 'www.fitchratings.com'
under the following headers:

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